How inflated is Venezuelan currency? So inflated that even thieves in Venezuela are refusing to steal it.
This has been reported in several media outlets such as the New York Times and Vox but a certain word is very noticebably absent in both reports. It is the S-word that dare not speak its name. One big reason it is taboo in liberal circles to associate that word with economic failure is that one Democrat candidate for president is openly an advocate of the unspoken system and most of the rest of the other candidates silently support it. We start with the New York Times story which avoids you-know-what word:
CARACAS, Venezuela — Pity the bolívar, Venezuela’s currency, named after its independence hero, Simón Bolívar. Even some thieves do not want it anymore.
...The eagerness to dump bolívars or avoid them completely shows the extent to which Venezuelans have lost faith in their economy and in the ability of their government to find a way out of the mess.
So what kind of economy do they have in Venezuela so we can learn to avoid their horrible situation? Please tell us, New York Times. Pretty please!
A year ago, $1 bought about 100 bolívars on the black market. These days, it often fetches more than 700 bolívars, a sign of how thoroughly domestic confidence in the economy has crashed.
Okay, the Venezuela economy has crashed so can you PLEASE tell us what type of economy they have that caused a nation with the largest oil reserves in the world to go broke?
The International Monetary Fund has predicted that inflation in Venezuela will hit 159 percent this year (though President Nicolás Maduro has said it will be half that), and that the economy will shrink 10 percent, the worst projected performance in the world (though there was no estimate for war-torn Syria).
Their economy has the worst projected performance in the world? So PLEASE tell us what that economy is. It is so lousy that we must ID it in order to avoid it. Unfortunately the Times offers no hint as to what is that horrible lousy economy which has produced almost worthless currency. Although the Times continues to provide us with economic horror stories from Venezuela they still won't get specific as to the name of that economy which must obviously be avoided:
Even as the country’s income has shrunk with the collapsing price of oil — Venezuela’s only significant export — and the black market for dollars has soared, the government has insisted on keeping the country’s principal exchange rate frozen at 6.3 bolívars to the dollar.
That astonishing disparity makes for a sticker-shock economy in which it can be hard to be sure what anything is really worth, and in which the black-market dollar increasingly dictates prices.
A movie ticket costs about 380 bolívars. Calculated at the government rate, that is $60. At the black-market rate, it is just 54 cents. Want a large popcorn and soda with that? Depending on how you calculate it, that is either $1.15 or $128.
The minimum wage is 7,421 bolívars a month. That is either a decent $1,178 a month or a miserable $10.60.
Vox cited this same Times story but they were just as shy in their analysis in providing the name of the horribly failed economy which needs to be avoided:
The Venezuelan economy is a disaster, owing to the country's byzantine currency pricing system as well as falling oil prices ...
Hmm... And what type of economy brought about their byzantine currency pricing system? Vox provides no answers. In order to find the answer, let us check out PanamPost writer Andrea Rondón García who identifies the culprit her article title, Socialism’s Secret Weapon in Venezuela:
One could argue that inflation is just another way that socialism controls the population.
First, consider the nature of this phenomenon. There is inflation when the money supply grows faster than the production of goods and services in a country. Prices rise. In other words, more money is in circulation, but it does not reflect an increase in the demand for money.
Thus understood, inflation can be curbed by enforcing property rights. Companies under private management are more efficient than government-run businesses, and if allowed to operate freely, they can provide plenty of goods and services to offset the increase in the money supply.
...I have previously argued that property and economic freedom are basic rights needed to impose checks and balances on the state, but we must also protect them due to their role in curbing inflation.
Inflation weakens our wages, crippling not only the ability to make ends meet, but also to afford and finance our long-term life goals.
In Venezuela, all branches of the national government have been pursuing a deliberate policy of undermining property rights since 2007.
...Inflation, just like violence and the prevailing ignorance in Venezuela, is indeed another way that socialism controls society. The long-term effects are there for all to see.
Thank you, Ms. Garcia for revealing the name of that economic system avoided by most of the American MSM in their stories about Venezuela's currency collapse.
